Aphria Reports Quarterly EBITDA of $1 Million

LEAMINGTON, ONTARIO--(Marketwired - Oct. 7, 2016) - Aphria Inc. ("Aphria" or the "Company") (TSX VENTURE:APH) (APHQF) today reported its first quarter results, for the three months ended August 31, 2016. All amounts are expressed in Canadian dollars.

Q1-2017			Q1-2016
$ 4,375,512		Revenue	$ 950,740
$ 3,782,145		Gross profit	$ 678,555
$ 3,321,596		Adjusted gross profit	$ 553,515
75.9	%	Adjusted gross margin	58.2	%
$ 895,269		Earnings (loss) before tax	$ (476,825	)
$ 1,054,269		EBITDA	$ (369,169	)

Q1-2017		Q4-2016
585.2	Kilograms (or kilogram equivalents) sold	340.4
$ 1.23	Cash cost to produce / gram	$ 1.15
$ 1.80	"All-in" cost of goods sold / gram	$ 2.08
$ 53,452,414	Cash and cash equivalents on hand	$ 16,472,664
$ 56,513,651	Working capital	$ 20,626,394
$ 7,529,688	Investment in capital and tangible assets	$ 434,602

Business highlights

• Closed land and greenhouse acquisition with Cacciavillani and F.M. Farms Ltd. o/a CF Greenhouses

• Closed bought deal financing generating approximately $32,000,000 net

• Received approval for sale of cannabis oil

• Commencement of Part II expansion (57,000 additional square feet of flowering space)

• Announcement of Supply Agreement with Medlab Clinical Limited (Australia)

• Acquisition of neighbouring 11 acres of land and greenhouses from DiNiro Farms Inc.

• Continued profitability and substantial EBITDA growth in quarter

Financial highlights

For the third consecutive quarter, the Company reported profitability. In the last three quarters, the Company reported income before tax of $3,720, $102,164 and $895,269, respectively. The increased pre-tax profitability relates to strong sales growth in kilograms (or kilogram equivalents) in the quarter, which grew 72% over the prior quarter.

The Company continued to report strong EBITDA levels, growing EBITDA 102% in the quarter to $1,054,269, the first time a public Licenced Producer ("LP") has reported more than $1 million in EBITDA, without including the fair value increase in biological assets. The EBITDA growth reflects the strong growth in kilograms (or kilogram equivalents) in the quarter.

Revenue for the three months ended August 31, 2016 was $4,375,512, representing a 58% improvement over the prior quarter's revenue of $2,776,316. The increase in revenue for the quarter was primarily a result of increased demand as measured by kilogram (or kilogram equivalents) sold.

Adjusted gross profit for the first quarter was $3,321,596 with an adjusted gross margin of 75.9%, generated from both retail and wholesale shipments of medical cannabis. The increase in the adjusted gross margin from the prior quarter is consistent with sales growth and the cost efficiencies generated by our Part I expansion.

Income before tax for the three months ended August 31, 2016 was $895,269 or $0.01 per share as opposed to a net loss before tax of $476,825 or $0.01 per share in the same quarter in the previous year and an income before tax of $102,164 or $0.00 per share in the previous quarter. Net income for the three months ended August 31, 2016 was identical to income before tax.

EBITDA for the first quarter was $1,054,269, compared to an EBITDA loss of $369,169 in the same period of the prior year and EBITDA of $520,685 in the previous quarter.

"Aphria continues to deliver on all operating metrics," said Vic Neufeld, Chief Executive Officer. "Patient onboarding, harvest yields, delivering in-demand strains, kilograms sold and low production costs have again generated stellar top line and bottom line results. Completion of the Part II expansion remains on schedule. Part III expansion just kicked off in the last two weeks. With expected annualized yields increasing to 18,000 kgs upon completion of the expansions, Aphria is strategically positioned for continued sustainable growth."

We have A Good Thing Growing.

About Aphria

Aphria Inc., one of Canada's lowest cost producers, produces, supplies and sells medical cannabis. Located in Leamington, Ontario, the greenhouse capital of Canada. Aphria is truly powered by sunlight, allowing for the most natural growing conditions available. We are committed to providing pharma-grade medical cannabis, superior patient care while balancing patient economics and returns to shareholders. We are the first public licenced producer to report positive cash flow from operations and the first to report positive earnings in consecutive quarters.

For more information, visit www.Aphria.com.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS: Certain information in this news release constitutes forward-looking statements under applicable securities laws. Any statements that are contained in this news release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are often identified by terms such as "may", "should", "anticipate", "expect", "potential", "believe", "intend" or the negative of these terms and similar expressions. Forward-looking statements in this news release include, but are not limited to, statements with respect to internal expectations, estimated margins, expectations for future growing capacity and costs, the completion of any capital project or expansions, any commentary related to the legalization of marijuana and the timing related thereto, expectations of Health Canada approvals and expectations with respect to future production costs. Forward-looking statements necessarily involve known and unknown risks, including, without limitation, risks associated with general economic conditions; adverse industry events; marketing costs; loss of markets; future legislative and regulatory developments involving medical marijuana; inability to access sufficient capital from internal and external sources, and/or inability to access sufficient capital on favourable terms; the medical marijuana industry in Canada generally, income tax and regulatory matters; the ability of Aphria to implement its business strategies; competition; crop failure; currency and interest rate fluctuations and other risks.

Readers are cautioned that the foregoing list is not exhaustive. Readers are further cautioned not to place undue reliance on forward-looking statements as there can be no assurance that the plans, intentions or expectations upon which they are placed will occur. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement.

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